In 2019, a number of Local Authorities issued Demand Letters for payment of the Vacant Sites Levy. The levy is charged at 3% of the market value for 2018 ( being the first year of the charge) and increases to 7% of the market value from and including 2019. The levy is payable annually in arrears and as such, the first demands were received in 2019 in respect of the year 2018.
The levy was introduced by the Urban Regeneration and Housing Act 2015 to help address the Housing Crisis by penalising the non-development of housing on vacant sites in urban areas.
Section 17 of the Urban Regeneration and Housing Act of 2015 does provide that where there is a change in ownership of a vacant site, the amount of the vacant site levy to be charged in respect of that site for that year and for the preceding year should be zero subject to certain pre-conditions as set out within Section 17.
Only time will tell if the imposition of the levy will have the desired effect to promote development on vacant sites. If you have any questions surrounding this or any other conveyancing matters, please contact Thomas Norris or Michael O’Grady in our office.